Freeze Your Credit for Free to Protect Against Identify Theft

If you have not heard of freezing your credit then you will want to read on.

In the summer of 2017, 143 million American consumers whose sensitive personal information was exposed in a data breach at Equifax, one of the nation’s three major credit reporting agencies.

The breach lasted from mid-May through July, with hackers accessed people’s names, Social Security numbers, birth dates, addresses and, in some instances, driver’s license numbers. They also stole credit card numbers for about 209,000 people and dispute documents with personal identifying information for about 182,000 people. And they grabbed personal information of people in the UK and Canada too.

Free credit freezes are here

Thanks to a federal law passed in 2018, anyone that has data with the three credit reporting agencies can freeze their account with that agency.

Security freezes, also known as credit freezes, restrict access to your credit file, making it harder for identity thieves to open new accounts in your name. As of September 21, 2018, you can freeze and unfreeze your credit file for free. You also can get a free freeze for your children who are under 16. And if you are someone’s guardian, conservator or have a valid power of attorney, you can get a free freeze for that person, too.

How will these freezes work? Contact all three of the nationwide credit reporting agencies listed in the matrix below. If you request a freeze online or by phone, the agency must place the freeze within one business day. When requesting a lift of the freeze, the agency must lift it within one hour. If you make your request by mail, the agency must place or lift the freeze within three business days after it gets your request. You can lift the freeze temporarily without a fee at any time.

Don’t confuse freezes with locks. They work in a similar way, but locks may have monthly fees. If you want a free freeze guaranteed by federal law, then opt for a freeze, not a lock.

Request Your Credit Freeze for Free

Placing a security freeze on your credit reports can block an identity thief from opening a new account or getting credit in your name. Setting up and managing security freezes are free of charge.

To establish your security freezes, you will need to contact each of the three credit bureaus. The links below will direct you to the credit bureaus webpage with instructions or you can go directly to their online form:

Equifax Experian TransUnion
Online Form Online Form Online Form

(Note: The links above will take you to the websites for the three credit bureaus.)

Be prepared to provide detailed information about yourself, including:

  • Your Full Name
  • Your Address
  • Your Date of Birth
  • Your Social Security Number

(Note: The credit bureaus already have this information in their files.
You will be providing it to verify your identity.)

Keep Your PINs or Passwords Safe

When you freeze your credit, the company will send you confirmation of the placement of the freeze along with information on how to remove the freeze, including any authentication information you will need, such as a PIN (Personal Identification Number) or password. The information should be sent to you no later than five business days after placing the freeze. Make sure to keep this authentication information in a safe place.

Lifting or Removing Your Freeze

When it’s time to apply for new credit or loan, you will need to temporarily lift the freeze online, with each of the credit bureaus, for the lender to be able to pull your credit. Some employers do back ground checks that include a credit check, this would be another reason to temporarily lift a credit freeze.

You can request that a freeze be lifted for a specified period of time or removed by making the request to each of the credit bureaus and providing proper identification. The credit bureaus must lift or remove a freeze one hour after receiving the request when the consumer makes the request by telephone or online. If the request is made by mail, the credit bureaus must lift or remove the freeze within 3 days after receiving such a request.

Update: Equifax Data Breach Settlement

On July 22, 2019, Equifax agreed to a global settlement with the Federal Trade Commission, the Consumer Financial Protection Bureau, and 50 U.S. states and territories.

First, if your information (most importantly, your social security number) was part of the hack, then you should assume it’s out there forever. Even if someone hasn’t stolen your identity yet, it could still happen.

Second, even if you file for reimbursement, there’s a good chance you won’t actually get the full $125 that Equifax and the FTC are talking about. Things are worded carefully in the agreement, but the bottom line is there’s a limited amount of money in the payout pool, and it won’t cover $125 checks for 147 million people.

Given all that, the biggest loophole you should be aware of is that if you do nothing, you will automatically waive your right to take legal action against Equifax in the future.

Learn if your data was stolen in the breach

Check if your data was stolen by entering the last six digits of your social security number and your last name on the Equifax form, (or call 833-759-2982). If it was not stolen, you are not eligible and you can move on with your life without thinking about this settlement.

If your data was compromised . . . you have several options.

File for ‘Alternative Reimbursement Compensation’

Note: By doing this you waive your right to pursue legal action against Equifax in the future

Deadline: Jan. 22, 2020

You can file a claim for the standard payout, up to 10 years of credit monitoring — OR — up to $125 to if you already pay for credit monitoring. They are calling it the “Alternative Reimbursement Compensation,” and it is the most straightforward path you can take.

If you really want the cash, you can sign up for a free credit-monitoring service like CreditKarma. Some credit card companies and banking services (like Mint) also offer credit monitoring services.

Fine print reveals why a lot of people won’t get the full $125. They are only going to pay out that amount until the requests hit a $31 million cap. After that, the payouts will be lowered and distributed on a proportional basis. The total pool for restitution is $380.5 million.

File for a bigger reimbursement

Note: By doing this you waive your right to pursue legal action against Equifax in the future

Deadline: Jan. 22, 2020

If you have spent or lost money as a result of the hack (legal or accounting fees, or the money you lost because someone stole your identity and charged a large amount of money on accounts in your name, the money you spent freezing and unfreezing your credit, postage, etc.) then $125 isn’t going to be enough.

In this case, you could file a claim for up to $20,000. You will need to provide proof of time and money spent, and the process is more involved.

You can also just file for time spent as a result of the data breach, $25 per hour for up to 20 hours. If you claim more than 10 hours, the FTC writes, you must detail the actions you took and provide documentation to indicate identify theft or fraud. If you claim fewer than 10 hours, you only need to detail what actions you took and how much time was spent.

You do not have to prove your identity was stolen directly as a result of the 2017 breach, but it has to have to occurred after the breach. You must file a claim by Jan. 22, 2020. Learn more about how to file a claim online here, or via mail here. If you were a minor on May 13, 2017, you must download and mail in this claim form.

Don’t settle, keep the option to pursue your own legal action

Note: This is the only option in which you keep your right to sue Equifax in the future

Deadline: Nov. 19, 2019

It sounds counterintuitive, but if you were affected by the breach you are automatically included in this settlement. And it’s similar to some of the settlements you hear about in court — if you settle, you’re done. You cannot bring it up in court again. You cannot sue Equifax for harm caused by the breach, because you were already a member of the group that settled.

If you don’t want to settle, and you want to keep the option to take legal action against Equifax as an individual, you must opt out of the settlement by mailing a written “request for exclusion,” postmarked by Nov. 19, 2019, to the settlement administrator. If you do not meet that deadline, you lose the right to sue Equifax for the breach.

Read more about this process in Equifax’s Frequently Asked Questions under section 23.

If you do nothing

If you were impacted by the breach and opt do nothing, according to the settlement’s terms, you will not be eligible for any of the aforementioned benefits. Moreover, it means you will forfeit your right to sue Equifax for harm caused by the breach or continuing pursue separate claims you’ve filed.

Click here to sign up for FTC email updates on the settlement.

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